Brazil raises tax on purchase of foreign currencies in cash

BRASILIA: Brazil's Finance Ministry on Monday raised a tax on the purchase of foreign currencies in cash, in its latest effort to boost tax revenue and reduce budget deficits.

The so-called IOF financial tax will be raised to 1.1 percent from 0.38 percent previously on the spot purchase of foreign currencies in cash.

The increase could raise tax revenue by 2.377 billion reais ($679.16 million) per year, the ministry said in a statement.

The ministry also increased the IOF tax on repurchase operations made between financial institutions and subsidiaries to 1 percent a day from zero previously, hoping to boost tax revenue by about 150 million reais a year.